The 10-second takeaway
For the quarter ended Dec. 31 (Q3), Infosys beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew and GAAP earnings per share dropped.
Margins shrank across the board.
Infosys booked revenue of $1.90 billion. The 28 analysts polled by S&P Capital IQ wanted to see revenue of $1.85 billion on the same basis. GAAP reported sales were 5.8% higher than the prior-year quarter's $1.81 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.76. The 11 earnings estimates compiled by S&P Capital IQ predicted $0.74 per share. GAAP EPS of $0.76 for Q3 were 5.0% lower than the prior-year quarter's $0.80 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 37.0%, 580 basis points worse than the prior-year quarter. Operating margin was 25.7%, 530 basis points worse than the prior-year quarter. Net margin was 22.7%, 270 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $1.97 billion. On the bottom line, the average EPS estimate is $0.74.
Next year's average estimate for revenue is $7.41 billion. The average EPS estimate is $2.97.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 1,105 members out of 1,143 rating the stock outperform, and 38 members rating it underperform. Among 258 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 248 give Infosys a green thumbs-up, and 10 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Infosys is hold, with an average price target of $45.05.
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